Naira ends August on positive note as dollar weakens slightly

The Nigerian currency, Naira, wrapped up August with a modest gain against the U.S. dollar, posting improvements in both official and parallel foreign exchange markets.

On the parallel market, the local currency strengthened from N1,552/$ on Thursday to N1,545/$ on Friday, while Central Bank of Nigeria (CBN) data showed an appreciation in the Nigerian Foreign Exchange Market (NFEM) from N1,533/$ to N1,531/$ over the same period.

By the month’s close, the naira had risen 0.14% against the dollar on the NFEM.

Nigeria’s foreign exchange inflows improved during August, driven by higher diaspora remittances and an uptick in foreign portfolio investments (FPIs). External reserves also expanded, climbing by $1.72 billion to $41.3 billion, bolstering the CBN’s ability to defend the currency.

“Nigerian diaspora remittances rose by 200 percent to $600 million in the last two months, significantly boosting Nigeria’s foreign exchange profile,” said CBN Governor Yemi Cardoso.

Offshore investor inflows also moved upward, increasing from $1.5 billion in June to $1.7 billion, reflecting measured foreign investor confidence under favorable carry trade conditions and stable global macroeconomic trends.

Mr. Cardoso emphasized that Nigerians abroad no longer need alternate channels to remit funds home, citing enhanced remittance systems and firmer exchange rates. He added that “growing diaspora flows are lessening Nigeria’s dependency on oil earnings and diversifying its foreign exchange portfolio.”